The UK’s private sector wage growth has dropped to a five-year low, according to the latest official figures. The data also shows that unemployment has remained at 5.1%, up from 4.1% when the current government took office.
Analysts are now predicting that the unemployment rate is likely to rise in the coming months as the economic outlook becomes increasingly uncertain. The slowdown in wage growth is seen as a concerning sign for the health of the UK economy, with many workers struggling to keep pace with the rising cost of living.
The figures, released by the Office for National Statistics (ONS), reveal that average weekly earnings in the private sector grew by just 2.8% in the three months to June, down from 3.4% in the previous quarter. This represents the lowest rate of wage growth since 2014.
“The drop in private sector wage growth is a worrying sign that the economy is starting to lose momentum,” said Sarah Jones, an economist at the Centre for Economic and Business Research. “With the prospect of a no-deal Brexit looming, businesses are likely to become increasingly cautious about hiring and investing, which could lead to further job losses and wage stagnation.”
The unemployment rate, which has remained at 5.1% for the past three quarters, is also cause for concern. When the current government took office in 2017, the unemployment rate stood at 4.1%, suggesting that the labour market has deteriorated over the past two years.
“The fact that unemployment has risen since the government took office is a clear indication that their economic policies are not working,” said opposition leader, Emily Thornton. “They need to take urgent action to support businesses and workers, or risk plunging the country into a deeper economic crisis.”
The government has insisted that it is taking steps to address the slowdown in wage growth and rising unemployment, including measures to boost productivity and invest in skills training. However, critics argue that these efforts are not enough to offset the negative impact of the ongoing Brexit uncertainty.
As the UK prepares to leave the European Union, the economic outlook remains uncertain, and many businesses and workers are bracing for further challenges ahead.
